EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0816279
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Elof Hansson Pty Ltd applied for a TCO in respect of certain woodfree paper in rolls on 07 July 2008.
Instrument
TCO No 0816279 was made on 26 September 2008. It declares that those certain woodfree paper in rolls are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is %. The rate of duty for the goods subject to the TCO is free.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0816279 is taken to have come into force on 07 July 2008.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Customs Act 1901, enacted by the Australian Parliament, provides the framework for the administration of customs duties and the regulation of imports and exports. In particular, Part XVA of the Act introduces a scheme under which Tariff Concession Orders (TCOs) may be made to provide tariff concessions for certain goods. The objective of this scheme is to encourage economic efficiency and growth by reducing the cost of imported goods through concessional customs duty rates, provided certain criteria are met. TCO No. 0816279 was introduced to address the specific issue of tariff concessions for certain woodfree paper in rolls, following an application by Elof Hansson Pty Ltd. The instrument was made after the Chief Executive Officer of Customs was satisfied that no substitutable goods were produced in Australia, thus meeting the core criteria set out in the Act. The TCO provides a zero rate of duty on these goods, which is expected to benefit importers by lowering their costs and potentially enhancing competitiveness.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders allow for lower rates of customs duty on specified goods, provided the application for a TCO meets the core criteria as outlined in the Act. A person may apply for a TCO if the goods in question are not specified in section 269SJ, which excludes certain goods from being subject to a TCO. The Act mandates that a TCO application meets the core criteria if, on the day of application, no substitutable goods were produced in Australia in the ordinary course of business. The Act further defines terms such as "goods produced in Australia," "ordinary course of business," and "substitutable goods." Once the CEO is satisfied that the application meets these criteria, they are required to make a written order specifying that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. The TCO applies to the goods specified in the order and has the effect of reducing the duty rate for these goods, which is effective from the date the application for the TCO was lodged. This mechanism is designed to benefit importers by potentially allowing them to apply for a refund of duty on goods imported since the TCO came into force, without imposing any new liabilities on persons other than the Commonwealth.
Key Provisions
The main sections of the Tariff Concession Instrument No. 0816279, under the Customs Act 1901, involve the process for applying for and granting Tariff Concession Orders (TCOs) (sections 269F, 269C, 269B, 269D, 269E, and 269P(3)). Specifically, section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO for certain goods. The CEO must then determine whether the application meets the core criteria, which include ensuring that no substitutable goods are produced in Australia (section 269C). If these criteria are met, the CEO must make a written order, declaring the goods to which the TCO applies (section 269P(3)). The TCO No. 0816279, made on 26 September 2008, pertains to certain woodfree paper in rolls and specifies that these goods are subject to a free rate of duty as per item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on parties or entities governed by it include the requirement for applicants to submit a valid TCO application to the CEO, ensuring that the goods in question meet the specified criteria. The CEO, on the other hand, has the obligation to evaluate the application, consider any submissions received, and make a decision based on whether the application meets the core criteria. The CEO must also publish a notice in the Gazette inviting submissions from any interested parties once an application is accepted as valid (subsection 269K(1)). In the case of TCO No. 0816279, the CEO did not receive any submissions in response to the published notice.
The Act does not specify particular offences, penalties, or civil/criminal consequences for breaches related to TCOs. However, the failure to comply with the requirements or the misuse of a TCO could potentially lead to legal actions under the broader Customs Act 1901. This might include actions for fraud, misrepresentation, or other breaches of customs regulations, which could result in civil penalties or criminal charges. The specific penalties would depend on the nature and severity of the breach, as outlined in other relevant sections of the Customs Act 1901 and associated regulations.